The Pound Sterling report below looks at the factors that could affect GBP exchange rates in the short term. With the currency markets fluctuating every two seconds, its important to keep up-to-date with what is driving exchange rates when making a currency exchange.

 

Sterling exchange rates rise to multi-year highs

The Pound has been a most impressive performer for 2015 with the Pound rising to multi year highs against nearly every currency bar the US dollar. The UK economy has very low unemployment and is growing at a healthy pace. All the indications are that at some point in the future the Bank of England will be looking to raise interest rates, this might be mid-2016; it could be 2017 but all the indicators are for this to happen eventually.

Compared to other leading economies and currencies this is putting the pound in a much stronger position from an investor’s point of view. However the UK economy and the Pound are susceptible to shocks and GBP could come under pressure as some of the UK economic data has not quite been up to scratch. Today at 09.30 is UK Retail Sales and tomorrow the latest Public Sector Net Borrowing figures which begs the question will these exceptional Sterling exchange rates continue, in particular the near 8 year high for buying Euros with Pounds?

Is now the best time to buy your Euros with Sterling?

The answer to this question is basically yes! We are less than 1 cent away from the best time to buy Euros this year which was reached on the 18th July. Prior to this the last time GBP/EUR exchange rates hit this level was November 2007! For the reasons above the Pound is partly responsible but events elsewhere have also contributed, notably the uncertainty about the economic direction of the Eurozone economy.

The GBPEUR exchange rate has risen almost ten cents in the last 5 weeks and this is I believe presenting an exceptional opportunity to buy Euros which may not last.

The bad feeling on the Euro is very much priced into the current exchange rate and I would now be getting worried for Euro buyers who are holding out hoping this gift will just keep giving!

Contact me at jmw@currencies.co.uk for more news on Pound Sterling exchange rates. To keep track of current exchange rates visit our live foreign exchange rates page.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.